This report begins by assessing how the situation developed with regard to the employment and social targets of Europe 2020 strategy, stressing that the current policies are jeopardizing the targets set out in 2010. Afterwards, it analyses how the ILO conventions have been respected during the implementation of the Portuguese adjustment programme. It is argued that reforms to the system of industrial relations and to labour legislation, as well as austerity measures taken to tackle the financial crisis and the lack of consultation of social partners regarding the fixing of the statutory minimum wage, are not respecting a set of ILO Conventions. Thirdly, as for social dialogue, it is emphasised that, even though two tripartite agreements have been signed between social partners, the current period is characterised by increasing conflict: industrial action and mass protests have escalated during this period. This policy note concludes by putting forward the main social and employment policy challenges facing Portugal in current times.